European-Led Climate Policy versus Global Mitigation Action. Implications on Trade, Technology, and Energy

“European-Led Climate Policy Versus Global Mitigation Action. Implications on Trade, Technology, and Energy” published in Climate Change Economics, Volume 04, 1340002 (2013), doi: 10.1142/S2010007813400022.

FEEM Working Paper No. 30.2014

Posted: 19 Apr 2014

See all articles by Enrica De Cian

Enrica De Cian

Fondazione Eni Enrico Mattei (FEEM); CMCC - Centro Euro-Mediterraneo sui Cambiamenti Climatici

Ilkka Keppo

University College London

Johannes C Bollen

CPB Netherlands Bureau of Economic Policy Analysis

Samuel Carrara

CMCC - Centro Euro-Mediterraneo sui Cambiamenti Climatici

Hannah Förster

Öko-Institut

Michael Hübler

Leibniz Universität Hannover

Amit Kanudia

KanORS

Sergey Paltsev

Massachusetts Institute of Technology (MIT)

Ronald Sands

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS)

Katja Schumacher

Institute für Applied Ecology

Date Written: April 17, 2014

Abstract

This paper examines how changes in an international climate regime would affect the European decarbonization strategy and costs through the mechanisms of trade, technology, and innovation. We present the results from the Energy Modeling Forum (EMF) model comparison study on European climate policy to 2050. Moving from a no-policy scenario to an existing-policies case reduces all energy imports, on average. Introducing a more stringent climate policy target for the EU only leads to slightly greater global emission reductions. Consumers and producers in Europe bear most of the additional burden and inevitably face some economic losses. More ambitious mitigation action outside Europe, especially when paired with a well-operating global carbon market, could reduce the burden for Europe significantly. Because of global learning, the costs of wind and especially solar-PV in Europe would decline below the levels observed in the existing-policy case and increased R&D spending outside the EU would leverage EU R&D investments as well.

Keywords: Climate Change, Stabilization Policy, International Participation

JEL Classification: Q5, Q54

Suggested Citation

De Cian, Enrica and Keppo, Ilkka and Bollen, Johannes C and Carrara, Samuel and Förster, Hannah and Hübler, Michael and Kanudia, Amit and Paltsev, Sergey and Sands, Ronald and Schumacher, Katja, European-Led Climate Policy versus Global Mitigation Action. Implications on Trade, Technology, and Energy (April 17, 2014). “European-Led Climate Policy Versus Global Mitigation Action. Implications on Trade, Technology, and Energy” published in Climate Change Economics, Volume 04, 1340002 (2013), doi: 10.1142/S2010007813400022.; FEEM Working Paper No. 30.2014. Available at SSRN: https://ssrn.com/abstract=2426182

Enrica De Cian (Contact Author)

Fondazione Eni Enrico Mattei (FEEM) ( email )

Campo S. M. Formosa, Castello 5252
Venice, 30122
Italy

CMCC - Centro Euro-Mediterraneo sui Cambiamenti Climatici ( email )

via Augusto Imperatore, 16
Lecce, I-73100
Italy

Ilkka Keppo

University College London ( email )

Gower Street
London, WC1E 6BT
United Kingdom

Johannes C Bollen

CPB Netherlands Bureau of Economic Policy Analysis ( email )

P.O. Box 80510
2508 GM The Hague, 2585 JR
Netherlands

Samuel Carrara

CMCC - Centro Euro-Mediterraneo sui Cambiamenti Climatici ( email )

via Augusto Imperatore, 16
Lecce, I-73100
Italy

Hannah Förster

Öko-Institut

Merzhauser Straße 173
Freiburg im Breisgau, 79100
Germany

Michael Hübler

Leibniz Universität Hannover ( email )

Institute f. Environm. Economics and World Trade
Koenigsworther Platz 1
30167 Hannover, DE 30167
Germany

Amit Kanudia

KanORS ( email )

Sergey Paltsev

Massachusetts Institute of Technology (MIT) ( email )

77 Massachusetts Avenue
50 Memorial Drive
Cambridge, MA 02139-4307
United States

Ronald Sands

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS) ( email )

355 E Street, SW
Washington, DC 20024-3221
United States

Katja Schumacher

Institute für Applied Ecology ( email )

Novalisstr. 10
Berlin, 10115
Germany
+49-30-405085321 (Phone)
+49-30-405085388 (Fax)

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